The Space Development Agency, an acquisition arm of the Department of Defense, on Monday announced nearly $1.8 billion in contracts to three companies for a next-generation military communications network of 126 satellites.
A pair of aerospace giants – Lockheed Martin (NYSE:LMT) and Northrop Grumman (NYSE:NOC) – and private venture York Space will each build 42 satellites for the SDA’s Transport Layer Tranche 1 (T1TL).
Lockheed won $700 million, Northrop won $692 million, and York won $382 million.
The SDA’s Transport Layer network represents the Pentagon’s bid to build a satellite internet system. Companies such as SpaceX’s Starlink, OneWeb, Amazon, Telesat have been pouring funds into developing private broadband satellite networks in low Earth orbit.
SDA awarded Lockheed and York with the first contracts for the Transport Layer in 2020 for Tranche 0, with each building 10 satellites that are scheduled to launch later this year. The Tranche 1 contracts awarded on Monday require delivery in 2024.
Lockheed shares neared the end of the trading day up $20.47, or 5%, to $427.16, while Northrop shares climbed $21.90, or 5.4%, to $431.57